Netflix (NFLX) shares are up $21.06, or 22%, at $116.10, after the company last night reported Q4 results and a Q1 outlook that topped analysts’ expectations.
I see two upgrades this morning, one from Citigroup’s Mark Mahaney, who raised his rating to Buy from Hold, with a $130 price target, up from $80 previously; and another from Gabelli & Co.’s Brett Harriss, who raised his rating to Hold from Sell.
Price targets zooming this morning, as you can imagine. Estimates are more mixed: several analysts have trimmed their revenue estimates or increased their net loss estimates as they try to get a handle on what’s happening with Netflix’s international business.
Mahaney writes that the company’s forecast for 1.5 million to 1.7 million streaming subscriber net additions this quarter “is consistent with Q2:11 pre-apocalypse Net Adds of 1.8 million” and “suggests NFLX�s Streaming segment is back to growth.” Mahaney also views as “key signs” of stabilization the “domestic streaming contribution margin” last quarter of 11%, the forecast for international losses below what might have been feared, and the “lack of competitive erosion” he’s observed.
Mahaney cut his revenue estimate for this year to $3.51 billion from a prior $3.71 billion, and increased his net loss per share estimate to a negative 18 cents per share from 11 cents.
Michael Olson, Piper Jaffray: Reiterates an Overweight rating and raises his price target to $130 from $100. “Q4 results will likely serve to increase the level of comfort investors have with a story that has been volatile and unpredictable in the last 6 months,” writes Olson. He raised his 2012 forecast to $3.63 billion in revenue from $3.59 billion, while cutting his EPS estimate to a 3-cent-per-share loss from a prior 34-cent profit.
John Blackledge, Credit Suisse: Reiterates an Outperform rating and raises his price target to $125 from $100. “NFLX’s 1Q12 guidance was solid overall, with domestic streaming better than expected, somewhat offset by lower expectations for domestic DVD, while int’l sub and oper losses were better than expected. We kept 2012 estimates largely intact, but did modestly boost longer term estimates.”
Youssef Squali, Jefferies & Co.: Reiterates a Hold rating and raises his price target to $115 from a prior $75. Squali cut his 2012 revenue estimate to $3.68 billion from a prior $3.71 billion, while trimming his net loss per share estimate from a loss of 66 cents to a loss of just 24 cents. The international business is a mixed bag so far, he writes: “While still early, traction in the two markets [U.K. and Ireland] is positive with sub growth YTD exceeding that of Canada for the comparable period. We find LatAm sub growth to be somewhat lagging as the company works through some payment and conversion issues.”
No comments:
Post a Comment